Episode #11 https://lnkd.in/g4KaxjHu what goes into building a fashion Brand.

It was truly insightful to watch #WTF11 ?Episode #11 https://lnkd.in/g4KaxjHu and listen to these legends. Entire episode was quite informative and full of insights on how to start and build a brand from scratch except couple of myth regarding luxury Brands and our fetish about white skin.

While I have great respect for Nikhil for building Zerodha and the kind of transparency they are trying to maintain with their customers, I've seen that as a norm when businesses become profitable, founders often tend to become careless and start trying to extract more money from the business by compromising on product quality or the service they offer. Zerodha remains an exception.

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When it comes to displaying exemplary vision and ethics, only Tatas come to mind, and I would like to put the Kamath brothers on par with them. The reason for showering so much praise is to make it clear that the topic I am about to discuss is in complete disagreement with what has been discussed in the episode. And disagreeing is not the same as disrespecting someone.

Coming to the myths which I want to debunk, discussed in the podcast:

One that Luxury Brands are arrogant and purposely create artificial scarcity, that they can scale production whenever they want and keep 1000 times margin.

The simple response to these perceptions is: No, they can't, even if they wish to. All luxury brands are driven by passion, and the unwavering passion for perfection and to create something unique leaves little room for mass production. Luxury brands don't keep 1000 times margins and can't scale up production as per market demands. Making true luxury products and selling them is much more complex than it appears, as it needs to? combine art and science both.

Luxury products are expressions of art, and we cannot expect artists to come up with masterpieces in great numbers within a set timeframe. Michael Angelo and Pablo Picasso could come up with only a handful of paintings and sculptures in their entire lives, despite being immensely talented.

Each collection a luxury brand comes up with is the result of at least one year's, in some cases, two years' hard work that goes into envisioning and designing a product, researching consumer behaviour and their lifestyle and patterns of consumption, new socioeconomic trends that are shaping up, finding the right colors and silhouettes, correct materials, textures, trials, and checking fits and testing. Unlike mass-market brands, trend-setting brands like LV and Hermes don't have the leverage to analyze past data, find out best-selling styles, and reintroduce them with some minor tweaks to make hundreds of variations.

Luxury means something rare, which is not readily available. Raw materials used by these brands are genuinely rare to find, selecting materials, their production process are time-consuming and cumbersome, which again requires time, effort, and extensive labor. For example, the wool 'Icon' one of the finest fibres that goes into the clothing lines of Loro Piana comes from the Vicu?a, the rarest animal in the world, a small member of camel family or cousins of Alpaca that lives wild in the high Alpine areas of Andes. Vicu?as produce small amounts of extremely fine wool, which is very expensive reason being the animal can only be shorn every three years and has to be caught from the wild.

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Unique Cashmere used by Loro Piana comes from the baby goats in northern China and Mongolia, and Lotus flower fibre comes from Myanmar.

The Sea island cotton used by most of the luxury brand for their apparel range comes from The Sea Island cotton plant, a unique species that is specific to the Caribbean, primarily in Antigua, Jamaica and Barbados region.

Known for its exceptional quality, softness, and durability, Sea Island cotton is made from the rarest and finest cotton in the world. It requires a warm and humid climate, fertile soil, and plenty of sunshine to thrive. These plants produces long, silky, and strong fibres that are handpicked and processed to create the Sea Island cotton fabric.

Extremely rarity and labour-intensive production process makes it so expensive. The fibers are handpicked and sorted to remove any impurities or imperfections, which requires a very skilled workforce, and the process is very time-consuming. Moreover, the production process is limited to a small number of farms and manufacturers, which adds to the exclusivity and prestige of the fabric. Peak production varies between 120-150 bales only, which is in no way comparable to the 100-120 million bales of annual global production of cotton.

Embroidered gowns and dresses from Christian Dior can take up to a month to complete the embroidery by a set of skilled artisans.

Calf leather that goes into Hermes Birkins mostly comes from the French Alps. Knowing that the European cattle population has declined by 40% over the last 20 years, the supply of quality raw hides has become very scarce. Leather selection norms for making Hermes Birkin bags are extremely stringent, and only one out of each 20 skins finished by the tannery is picked for making these bags. These Birkin bags are made to last for generations and can withstand 60,000 Martindale abrasion cycles, whereas most leather available in the mass market start showing signs of wear at mere 5,000 cycles.

Apart from the rarity of raw materials, another limiting factor that restricts luxury clothing and accessories' production is the labour-intensive process, attention to details and the unavailability of highly skilled craftsmen.

Unlike mass-market brands, luxury products are not produced in a batch size of 10000-20000 pcs in a fully mechanized production plant in China where 40% of the process is automated, and line managers are under constant pressure to; increase productivity and save a few extra cents to increase profitability. Rather they are handcrafted by highly skilled artisans in Paris, Milan, or Florence, and they pay close attention to every detail of the products where priority is perfection not speed. Each component of the Birkin bag is cut manually, and each stitch of the bag is sewn by hand, each rivet is fixed manually. On an average, these bags need 48 to 72 hours from cutting to finishing. The reason there is often a long wait for these products is that each of them is made to order one piece at a time and never produced in bulk with an objective to provide each client a unique and exclusive experience.

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If we talk about iconic Berluti shoes, each pair is hand-lasted and customizable from the wooden last to the choice of leather and patinas. Unlike ready-to-wear shoes, which are simple adaptations of existing models, these bespoke shoes are created from scratch. The client is at the very centre of the process, and the future shoe will be created according to the morphology of the individual client's foot. From the meeting between the master shoemaker and the client to delivery, no less than 50 hours of work are required to create a pair of bespoke shoes. Shape, soles, colors, etc., everything is adapted to the client's desires, needs, and specifications. This includes zeroing in on the leather, the last-maker, pattern-maker, cutter, stitcher; the craftsmen in the bespoke workshops will have carried out over 250 operations in order to offer their client the perfect shoe. The famous engraving on the leather is done manually on each and every odd of these shoes produced. ?

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The average labour cost in Europe is 20 Euros per hour, and for skilled labor, it goes up to 80 Euros, roughly 7200 rupees per hour in INR terms. "I'm sure everyone here is smart enough to calculate how much labour cost needs to be paid for each of these prized possessions and to conclude, not only there is acute shortage of skilled artisans in Europe, but it also takes years to train them, which severely limits the number of products these brands can produce."

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Another major factor that differentiates luxury brands from mass-market retailers is not only that they offer unique artifacts but also a unique experience. When selecting retail outlets, they have very limited options and most of the time, their own retail stores. Setting up stores for these brands is another challenging aspect. Not only do you need to train a sales team carefully, but you also need a vast amount of resources to train them to carry themselves confidently as brand ambassadors, finalizing the correct location, and ascertaining the scale of economies, takes a lot of research, consideration, and time.

One of the biggest reasons India is yet to come up with a true luxury brand is that we often look down upon the efforts and skills of our craftsmen and fail to appreciate their hard work and efforts. Most of the time, our vision is limited to calculating material cost and we fail to understand that creating unique products requires time, passion, and a lot of labour and effort, which is never cheap and comes at a hefty premium.

Other myth that was discussed in the podcast, and I choose to differ on the fact that customers click images more which have European models due to a colonial hangover. Rather It has more to do with the presentation and skills of the photographer and the way pictures have been clicked, edited, and presented on the website. Also, we need to note that compared to Indian counterparts, European models are well-trained, easy to work with, have fewer attitude issues, and put more effort into making the picture perfect. Customers are attracted to the picture if they find it appealing, not due to the fact that a model is European, Black, or Indian."